Final Thoughts

December 18, 2019

U.S. Steel tonight announced their intention of focusing their company on three core assets: Gary Works, Mon Valley Works and Big River Steel. This comment was made at the same time they announced their intention to idle a large portion of their Great Lakes Works near Detroit. WARN notices have been sent to the 1,500+ workers at that plant. Folks, the steel industry is changing right before your eyes. Change that took decades is now taking months.

I have been asked many times if I believe in Steelmageddon. Do I believe in the idea that the steel mills will cannibalize themselves by bringing up more supply than the market can buy? I believe the mills are (finally) doing what they need to be doing. Bringing on the technology and offering new products. Combining with commodity suppliers and figuring out other ways to lower costs to be internationally competitive. Putting plants where they need to go, and fighting to keep out unfairly traded steel – at least until the new plants are up and running. No, I am not a believer in Steelmageddon. I am a believer that the industry is figuring out how to survive in a tough world, and at the same time figuring out what they need to offer North American manufacturing companies so they can purchase North American steel and still be world competitive.

Does this mean I no longer support the idea of free trade? Do I no longer believe that some steels need to come from international sources? I remember when I was selling steel for a domestic steel mill and watched that mill walk away from product it could produce, but preferred not to in a tight market. There does need to be some checks and balances, to use a political term.

Will all of the moves being made bear fruit? Is USS making the right choices? Are Steel Dynamics, Nucor and others making the correct decisions in order to survive a few years down the road? It is not up to me to answer those questions. However, I will do my best to bring in the industry to discuss the issues in more detail at our conferences, at our steel training workshops, and by sharing their stories with us for our newsletter.

This is my opinion at this point in time (subject to change) and I welcome comments, which you can do by sending them to: John@SteelMarketUpdate.com

I have been extremely busy working on the keynote speakers for the 2020 SMU Steel Summit Conference. Based on the moves I am making right now, I believe we will have the strongest program ever – especially on the final day of the conference. I don’t want to totally tip my hand quite yet as all of the negotiations are not yet complete, but I highly recommend you arrive early and plan on staying to the end of the conference (make your return flights for 3 p.m. ET or later on Wednesday, Aug. 26).

Steel Summit The steel industry is undergoing a transformation and that will be the theme of the 2020 conference. We will return to a strong forecasting conference with special attention placed on how buyers and sellers of steel deal with an industry that is reinventing itself before our eyes. This will include speaking directly to the steel mill CEOs, taking a look at the technology, costs and carbon footprint of the industry, industry inputs, economic forecasts, manufacturing panel, main market segments panel and an eye on the politics of the day and what you need to do no matter what happens in November 2020.

Registration for the 2020 SMU Steel Summit Conference is now open. If you were an attendee from the 2019 conference, you should have already received a link for hotel registrations. We have added a brand-new hotel, which is under construction right now but should be ready well before our conference begins. The hotel is an AC Hotel, which is part of the Marriott group of hotels. This brings the number of hotels up to five for 2020: The Gateway Hotels – Atlanta Marriott Gateway, Renaissance Gateway, SpringHill Suites Gateway, AC Hotel Gateway – and then the Atlanta Airport Marriott Hotel located about one mile from the convention center. When you register you will receive links for hotel registration in your confirmation email.

We have received more registrations for the first SMU Steel 101 workshop of the New Year, which will be held in Ontario, Calif. We will be cutting off registrations for that workshop at the end of the business day tomorrow (Friday, Dec. 20). From that point it will be on an inquire-only basis.

The next Steel 101 workshop in 2020 will be held in Merrillville, Ind. (outside of Chicago) and will include a tour of the NLMK Portage, Ind., EAF mill. We hope to have registration for that workshop up on our website soon. If you have any questions about this workshop, please contact Events@SteelMarketUpdate.com

My best wishes go out to metals and mining analyst and good friend Timna Tanners who is about to have a baby…. Stay tuned for more information about babymageddon ™

If you have any questions about SMU renewals, upgrading your membership from Executive to Premium (thus getting our new Service Center Inventories and Shipment data and other Premium only products), adding more people to your membership or becoming a first-time subscriber, please contact Paige Mayhair at 724-720-1012 or by email at Paige@SteelMarketUpdate.com

We are one day closer to the Hanukkah and Christmas Holidays, and we are quickly heading into the New Year. I know there will be many of you taking next week off for an extended end-of-the-year holiday, so we want to cover as much as we can before you leave.

We are completing our analysis of the last flat rolled and steel plate market trends survey of the year. We are reporting out the results in tonight’s and Sunday evening’s issues of SMU. Sunday’s issue will be the last prior to Christmas. We will also publish an issue on Sunday, Dec. 29, otherwise we will be giving our employees some well-deserved time off over the holidays.

Christmas Tree For those of you who are going on vacation at the end of this week and won’t be opening our Dec. 22 issue – Happy Holidays. Enjoy Hanukkah or Christmas with your family and friends. We will be here when you get back.